All Forum Posts by: Kurt K.

An umbrella policy may be all you need to reduce your liability exposure. Like others side, banks won't loan to a new LLC without your personal liability attached. An LLC is also, not reason to carry a necessary amount of liability insurance anyway. Of course you don't want to lose your personal residence over not being covered, but do you really want to lose your property over not having enough coverage? My point is, what covers you and your assets (personal or business) is insurance, not the LLC.

Mark Podolsky that clears it up! Thanks, I think I misunderstood your first post.

Mark Podolsky the examples aren't entirely congruent. The sushi example, your advice is essentially find a niche, become the best at it and watch your passion for it grow. If this is the case, why even transfer to real estate at all? Why not just grow in whatever business you have developed that you are proficient in? (which may be your advice to Nick?)

Your personal example was more pertinent, where you did a job that you hated for good money, to do what you love. Unfortunately for Nick, most "day jobs" don't pay near as much as an investment banker, along with the education required. You were able to stay sane due to the fact that you weren't going to have to grind it out for long. For the average person to "grind it out" to try to get to a point to do what you love isn't good advice in my opinion. Your quality of life will be much better if you can be happy with yourself when you go to bed a night and get up in the morning. If the thought of work makes you miserable, you're aren't in the right job, career, etc. Life is too short to compromise time on something you hate. There will be enough "bad days" doing something you love already.

So if your passion is real estate investing, but it just isn't economically feasible at the moment, do something that you still enjoy doing. Your health and relationships will stay in much better standing that way.

As a caution... your "passion" may be deceiving. Meaning that whatever makes you think you're passionate about something you've never tried, may not turn out to be so. If you "grind it out" for the purpose of real estate only to find you really don't like all of the troubles that do come along with the business... you've really wasted a lot of time and effort. (sort of a "grass is always greener" warning)

I typed this fast, without looking it over, so I hope it is coherent!

I only own 1 property and it is a 6-unit multi-family. 3 units cover all my expenses including mortgage, the other 3 units are pure profit. Like I said, I'm new to the game, but if this is what it's like, I've been missing out.

The average over night success is 10+ years in the making. It sounds like essentially you have a lack of funding problem. If you can't fund your desired investments with the money you have now, you either have to do something else to create that money or find capital partners to go in with you (people that will give you the money for part of the profit). Otherwise, I don't know of any other way. I think many of us at BP have "day jobs" and we're building our real estate business on the side until it can stand on it's own.

That's one of the "downsides" to buy and holds, is that you can run out of investing funds fairly quickly. Using equity is one source, partnership is another source (someone who chips in the money while you do all the "work" of running it), 0% down (much harder these days) is another source, or just simply waiting till you have more funds saved up to buy another. One of the best ways to buy more properties is to update your property you just bought and create "forced appreciation", or make it worth more from your updates interior/exterior/landscaping/etc. Then 1031 exchange that property into a larger property that produces even larger cash flows.

The "upside" to buy and hold, is that it is also like a snowball. Where at the start you own a couple of properties and cash flow is much more scarce. But as your portfolio increases (whether in number of properties or "size" of properties) you will have ever more cash available, and eventually a cash flow surplus, all the while you are building equity on your properties.

A lot of the above options have to do with personal preference or what is available in deals in your area. It is hard to give a catch all answer of "this is the way to do it".

As a more constructive opinion, you can get "Terrorism Insurance" on a home policy, so... I would presume that if the people had this coverage the insurance company would reimburse them. Otherwise, I highly doubt the government will.

Thanks Bill. You story sounds a lot like mine!

I don't have any real objection to her living there I just wouldn't want my grandmother to be going up and down those steps every day so I was hoping she would move to the lower apartment. I appreciate all of your comments as it has relieved some worry off of my mind over the issue. She is an otherwise good tenant.

Thanks everyone.

Thanks for the replies. It is my understanding from internet searches that one cannot indemnify against death or personal injury in the United States.

So I have an elderly tenant that I have inherited when I purchased the property. She is well into her 80s and is living on the SECOND floor. the stairs, while they do have a handrail, are narrow and steep, as it is an old home. I have a unit on the first floor but she has refused the suggestion to move out or move down there, she states that she is "perfectly healthy".

Multiple times this winter when I'm doing random checks she has stopped me to tell me that while she was out that "the cold got her" and she had to crawl back in on her hands a knees. She also asks me if my feet ever "feel spongy" and she sure hates it that hers do now.

She seems to have no family, I have spoke with her Power of Attorney on one occasion and she seemed shocked that I thought she should either move downstairs or out of the building.

What should I do in this situation where it is clearly not safe for her to be living on the second floor? If she has one of her "spells" on the stairs she is sure to fall down them. I know I cannot discriminate upon age but is there something I can do where it isn't safe for her to live up there to get her to move? She is an otherwise "good tenant" but I feel very uneasy knowing she is climbing the stairs everyday.

Thanks in advance.